Finance Minister Satsuki Katayama reiterated that the government doesn’t need to compile an extra budget for now, adding that a recent rise in yields on Japanese government bonds is part of a broader global trend.

“Bond yields have been rising across all three major markets,” Katayama told reporters Friday, citing selloffs in the U.S., U.K. and Japan. “These developments are interacting with each other and creating something of a compounding effect,” she said.

Katayama was speaking a day after yields on long-term Japanese government bonds climbed to multi-decade highs, in moves driven partly by spillover concerns in the Treasury market after U.S. inflation spiked. The 30-year yield climbed to the highest since the tenor’s 1999 debut, while yields on 20- and 40-year debt also touched the highest in decades.

The spike in JGB yields also reflects renewed concerns over Japan’s fiscal position after reports that the government is considering an extra budget. Prime Minister Sanae Takaichi’s administration is weighing a supplementary budget to fund price relief measures as elevated oil prices and uncertainty over the conflict persist, Kyodo News reported Thursday.

Katayama said Friday that the situation has not yet reached the point where an extra budget is needed. “We have ¥1 trillion ($6.3 billion) in reserve funds for the fiscal 2026 budget. We haven’t touched those funds at all yet,” she said.

Adding to pressure on bonds is building speculation over a possible Bank of Japan rate hike next month. A board member who voted in April to hold policy settings steady called Thursday for a rate increase as soon as possible provided the economy holds up.

Katayama said Group of Seven finance chiefs are expected to discuss developments in bond markets when they meet in France next week.

Officials around the world have raised concerns about rising inflation as geopolitical turbulence threatens supply lines. Federal Reserve Gov. Michael Barr noted Thursday that “the risk is much higher right now that inflation will not behave.”

In the latest evidence of that dynamic, Japan’s corporate goods prices rose in April at the fastest pace in 12 years, according to BOJ data released Friday. That early sign of mounting inflationary pressure contributed to a further rise in JGB yields.

The yen has steadily pared gains ever since its slide past 160 per dollar prompted Japanese authorities to begin intervening in the currency market on April 30. After strengthening to 155.04 to the dollar on May 6, Japan’s currency has retraced to around 158.49 Friday morning in Tokyo.